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Contents OF fREE sAMPLE bOOK
16. Commercialization of Healthcare in India  110-118

This sample book is prepared from the book "35

Landmark Social Developments for UPSC IAS/ IPS
Prelim & Main Exams".

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 Contents OF Complete bOOK

1. Poverty in India 1-9

2. Unemployment in India 10-17

3. Illiteracy in India  18-24

4. Caste System in India 25-30

5. Gender (Domestic) Violence in India 31-37

6. Communalism in India  38-45

7. The Dowry System in India  46-51

8. Status of Women in India 52-58

9. Mental Illness in India 59-64

10. The Surrogacy (Regulation) Bill, 2020  65-71

11. Problem of Child Labour in India 72-79

12. The Problem of Naxalism: Its Resolution 80-87

13. India’s Growing Population  88-94

14. Farmers’ Problems in India 95-101

15. Student Suicides: Challenges and Solution  102-109

16. Commercialization of Healthcare in India  110-118

17. Infant Mortality and Immunization in India 119-126

18. Juvenile Delinquency in India 127-133

19. Water Scarcity and Prospects in India 134-140

20. Covid-19 and India’s Response 141-147

21. Public Health System in India 148-157

22. Universalization of Education in India 158-166

23. Problems of Elderly People and Old Age Homes 167-173

24. Women and Girls Trafficking in India 174-178

25. The Problem of Beggary in India  179-184

26. Rural-Urban Migration in India 185-190

27. The Issue of Terrorism in India  191-197

28. Rising Hate Crimes in India 198-205

29. Corruption in India  206-211

30. The Problem of Child Labour 212-219

31. Challenges faced by LGBTQ Community in India  220-227

32. Human Rights and Access to Justice 228-233

33. Impact of Social Media on Youth 234-240

34. Role of NGOs in India 241-247

35. Drug Menace in India 248-254

Annexure A-1-6

Previous Years IAS Prelims & Mains Questions P-1-16

 110

16 COMMERCIALIZATION OF
HEALTHCARE IN INDIA

BACKGROUND
The failure of the Indian state in providing adequate services to its citizens has
been one of the main causes for the rise of capitalism in the country. One of the
most basic amenities which millions of people across the country lack are access
to basic healthcare services remains a distant dream. The condition of government
hospitals in most places is deplorable. From hygiene issues to lack of adequate
doctors or nurses, these hospitals depict the apathy of the system which has to be
dealt with by ordinary citizens.
The slow and steady deterioration of government hospitals, as well as the constant
queues outside them, ensured the entry of private players who are looking to
exploit these circumstances. Hence, the commercialisation of the health sector has
been on a rise in India. Although there have complaints and people have opined
those private hospitals are charging customers exorbitantly but these have not
only increased access but also helped millions of people with quick and effective
treatments.
Only 22 per cent of the health expenditure is public-funded in India as compared
to 44 per cent in the US, or 95 per cent in countries like Sweden or 75 per cent in
all the market economies of the world taken together.
OVERVIEW
A heterogeneous private sector dominates healthcare provision in many middle-
income countries. In India, the contemporary period has seen this sector undergo
corporatisation processes characterised by the emergence of large private hospitals
and the takeover of medium-sized and charitable hospitals by corporate entities.
Little is known about the operations of these private providers and the effects on
healthcare professions as employment shifts from practitioner-owned small and
medium hospitals to larger corporate settings.
In India, the post-reform era shows gross neglect of the health scenario. Investment
in the health sector yields only long-term gains which seem to be at odds with
short term political gains which our politicians always tend to seek. Under the
Structural Adjustment Programme funded by IMF-World Bank, the government’s
share in total health has not shown a commensurate rise with the increase in
 111
population. Due to poor access and quality of service, the rate of utilization
of public facilities has shown a decline over the years as per the report of the
National Sample Survey Organisation. It has also been observed that whatever
public facilities are available they are utilized more by the rich sections.
The share of the richest 20 per cent for in-patient bed days is about 6 times
more than that of the poor. In monetary terms, less than 10.2 per cent of total
government investment in health services goes to the poor and 31 per cent to the
richest by comparison. The poor spend disproportionately higher per cent of their
incomes on health services.
More than 30 per cent of their income goes for treatment for minor ailments,
infections and communicable diseases. The neglect of preventive health care in
public health policy is the chief cause of this situation. Out of the total government
expenditure, only 13 per cent is spent on primary care, 25 per cent on public
health research and a hopping 60 per cent for secondary and tertiary health care.
Due to this, 55 per cent of rural primary care is sought from private practitioners,
of whom many are unregistered and another 24 per cent from private clinics or
nursing homes. Against this backdrop, the issues of traditional medical systems
and their usage appear to be of great importance in India.
Another unexpected trend needs to be mentioned. Although market-based reforms
in health care are advocated in almost all the developing countries, the state
continues to play a major role in the delivery of health care services in developed
countries, especially in America, West Europe and Australia. However, the degree
of commercialization of health care services as measured by the spending of the
private individuals varies from country to country.
The results of commercialization of health care, considered generally, and not with
specific reference to India have not been very encouraging. The observations made
in this regard show that countries with better health outcomes have significantly
lower commercialization in health care services; better care at birth is associated
with more of GDP spent by the government on health, but not with more private
health spending to GDP; higher commercialization at primary health care is
associated with greater exclusion of children from treatment when indisposed.
It is quite evident that the introduction of private competition and user charges
in public health discriminates against the sick and the poor. The condition of the
health care system in all big and small cities in India shows that the poor have
no or little access to health care facilities. The public hospitals are all full of
patients; beds are not available wherever we go. The medicines are always short
in government hospitals. The situation in remote areas of the country and most of
the villages leaves much to be desired. On the other hand, the rich have access to
health care everywhere. In cities, private clinics, hospitals and diagnostic centres
are in every part. They welcome patients who can afford expensive treatment.
The commercialisation of healthcare is certainly against the policies of social
equalities which India aims to bring. It has also led to many undesirable practices.
 112
Private clinics often subject the patients to conduct many tests which are not
necessary. They admit patients who do not require admission. This is done to earn
more money. Operations are performed at times when they are not required or are
bad for the patient’s health. However, some hospitals and clinics keep a strict code
of conduct and do not adopt such unscrupulous practices. Their high charges are
justified because of the high cost of inputs.
The fact cannot be denied that the commercialization of health care has
supplemented the public facilities in this regard. It has rather helped the
government to maintain a high level of health care in the country. In all major and
small cities and towns, private health centres are open day and night and are ready
for any emergency. They are saving the lives of thousands every day. The private
hospitals and clinics have employed lakhs of doctors, nurses and other staff across
the country. The government is earning huge revenue in the form of taxes.
These clinics, diagnostic and treatment centres have also created a huge demand
for health care products, instruments and medicines. This industry has flourished
to become the fourth-largest health care industry in the world. The economy owes
a lot to this commercialization. Today, India has a strong and sophisticated tertiary
health sector where people from outside the country come for medical tourism.
Given this situation, India can take advantage of its indigenous medical system to
ensure cheap, accessible and capable medical care for its population, particularly
the poor. India has many systems like Ayurveda, Unami, Siddha, etc. which it has
developed since the ages. These systems need to be expanded and exploited for
the improvement of the general health of the people.
In the latest phase of commercialisation of healthcare, development finance and
private equity investments have together fueled the growth of corporate hospitals
in low-income and middle-income countries (LMICs). Large multispecialty
and super-speciality private hospitals offer a new model of care provision but
beyond that, as we argue in detail elsewhere, corporate ways of working also
impact the management and operation of medium-scale hospitals and charitable
trust hospitals within the private provision sector. In line with the global push
to expand the healthcare industry supported by the World Bank’s International
Finance Corporation and other development financing institutions, healthcare is
being viewed as providing potentially lucrative business opportunities. However,
a recent Lancet series highlighted how little is known about the operation of
private providers and the difficulty in assessing their effects on healthcare.
This reorientation of healthcare also has significant implications for the working
lives of those in the workforce of healthcare organisations. Various writers on
transformation in the private healthcare sector have recommended more research
on its effects on doctors and medical practice. The literature on the effects of
healthcare corporatisation on employment practices in high-income countries
emerged in the 1970s and 1980s and has been subject to renewed interest in the
last few years.
 113
Commercial Surrogacy
Surrogacy is an arrangement between a woman and a couple or individual to carry
and deliver a baby. Women or couples who choose surrogacy often do so because
they are unable to conceive due to various reasons. In past, it was generally
confined to close relatives or friends in altruistic mode but with growing demands
payment of money to surrogate mothers have become a norm which is known
as commercial surrogacy. India is the main destination for surrogacy and Indian
surrogates have been increasing.
In Favour
•• Private hospitals spend vast amounts of money to buy necessary equipment.
•• Private hospitals keep their hospitals clean and take more care of their
patients.
•• The government itself can’t invest more money in hospitals. So, it’s better to
give responsibility to private people.
•• Because of the commercialization of health care number of doctors is
increasing.
In Against
•• Private hospitals recommend tests and medicines unnecessarily, just for
their profit.
•• Not everyone can afford treatment in private hospitals.
•• There are many cases of unnecessary surgeries in private hospitals.
Causes of Increased Commercialization of Indian Healthcare
Health care is one of the most crucial sectors in our nation. But unfortunately,
people have made this too a source of income rather than thinking of offering
a genuine service. Commercialization is a word which in simple terms means
making a profit out of something. But to the saddest part, in India now health
services have also become a profit-making sector because of corruption.
Government Corruption
Government-run hospitals are established to make sure that proper medical
treatments are provided to people below the poverty line without any hindrance.
It is run to provide social service to poor people who cannot afford the expenses
of paying the fees of a doctor and buying medicines. But unfortunately, nowadays
this is not the case. The plight of the government-based hospitals is known to
all. Indiscipline and irresponsibility have taken a toll there. There are no decent
doctors available, the hygienic condition of the hospital is bad and there is a lack
of space to accommodate people. A hospital is a place where hygiene is given
utmost importance. But in government hospitals, it is not so. Just because they
treat the patients for free or for very little cost, they do not pay heed to such things.
Because of irresponsibility and lack of diligence towards duty, the number of
 114
patients dying has also increased. Proper treatments are not provided to them due
to which they are not able to survive. Because of these malpractices and corruption,
only a few government hospitals function normally as they are supposed to. The
rest all are a disgrace to society.
Private Investors’ Profit Motive
On the other hand, we have private hospitals which are hygienically very clean.
They have ample space to accommodate patients, have qualified doctors and the
best possible treatments available in their hospital; but for all of this, they charge
exorbitant prices. They have made this health sector a commercial business, where
they charge a high amount of fees to their patients for checkups and treatments.
They are driven by profit motives and view it as a source of heavy income.
Many times, the doctors in these hospitals make wrong suggestions to the patients
just in a hurry to make a quick buck.
With an Indian population of more than 22% below the poverty line,
commercialization of the health sector needs to be immediately checked upon.
With such practices going on in the country, the rate of decrease of the population
will increase at an alarming rate. People will die due to a lack of diagnosis of their
diseases and deprivation of medical facilities.
Unnecessary Stress to the Doctors
The whole model of incentivising doctors for tests and procedures has just too
many problems.
Many doctors have started resisting this model. Some companies are being formed
that are changing the model to show that doctors can still make money (nothing
wrong with that!) but by ensuring better care. The US’s WellMed has a model
where “if a doctor improved the quality of care, this would save on costs, and
WellMed would share those savings with the doctor in the form of bonuses.” This
is where healthcare should be moving towards.
Doctors should be incentivised, no doubt. They should be allowed to make money.
After all, they spend years learning medicine, spend lakhs of rupees getting their
education. What is wrong with them trying to recover those costs and lead a
comfortable life? Aren’t they entitled to a good life as well? Of course! The only
issue is that this should not be at the patient’s expense. This should happen only
if they ensure that their patients do well! Outcomes-based incentives are the way
to go.
Despite people cribbing about corporate hospitals, these hospitals are the ones that
have brought quality healthcare to the Indian population. Walk into a government
hospital today and you see the difference. Many of these hospitals are very badly
run. They just do not have the infrastructure to cater to the large volume of
patients. The only way patients have got access to quality is due to these corporate
hospitals. There’s no denying that the latest technology has been made accessible
to patients in India only due to the corporate hospitals.
 115
Many doctors are also becoming increasingly frustrated with the system that
accuses them of various unethical practices but glosses over the constraints they
are operating under. This led to a doctor saying he would never advise his child to
become a doctor in India.
What needs to be done is to turn the model on its head and make sure that
corporate hospitals remain profitable, doctors continue to earn a decent
income and yet patients don’t have to undergo unnecessary procedures and
tests. I’m sure the MBAs and consultants that are managing these hospitals
can figure this out!
A great beginning has been made by the SLIM (Society for Less Investigative
Medicine) initiative started by some Indian doctors. This society aims to reduce
the number of investigations and interventions for patients. An article about the
initiative says, “Doctors from across the country and non-medical professionals
‘frustrated by the sheer avarice on display in the entire field of medicine’ have
expressed their desire to be part of the SLIM initiative.”
One suggestion to SLIM - give people who are part of this initiative a certificate
or a poster they can proudly display in their clinics and increase awareness about
this initiative. When patients go to SLIM empanelled doctors, they can be sure
that they would not be subjected to unnecessary medical expenses.

Facts you need to knoW

•• The decade of the ’90s saw several state governments restructure their
secondary level hospitals with loans from the World Bank. This project is
being implemented in Punjab, Karnataka, Andhra Pradesh, West Bengal,
Maharashtra and Orissa under the aegis of the Bank’s state health systems
project. As a part of the restructuring exercise, a considerable amount
of money has been invested in the renovation of buildings, purchase of
equipment and supply of strip packaged drugs. The restructuring exercise
also involves the introduction of user fees as a source of revenue to
finance the secondary level hospitals.
•• During the late ’80s, a majority of the hospitals and nursing homes
had a bed strength ranging from 5-100 beds. Located in urban areas
these facilities were owned by doctors in single owner or partnership
enterprises. In some states, the smaller enterprises had spread to towns
and even villages.
•• The growth in imports of medical technology has made health care a
profitable business venture. Since the late ’80s, there has been a steady
increase in the import of medical equipment.
 116
KEY TERMS
Commercialization of Healthcare: It means a good hospital with having better
facilities, nursing care, technology and provide better accessibility to the people.
It means private owned hospitals.
IMPACTS

Economic
The commercialization of healthcare facilities in India is leading to a drain of
wealth. The big branded hospitals are trying all the methods to financially exploit
the people. Even the doctors are forced to look at the patient as a customer, not
as a sick, needy person. Only the rich can afford it because they have health
insurance but the poor are getting poorer and cannot afford the treatment. The
health sector is gradually transforming into an MNC with the doctors being forced
to become its corporate employees.
Political
The health sector is today being influenced by the politics of the country. The
political leaders and other lobbyists put force to pass the laws that are in favour of
the profits of the corporate hospitals. The common people look at this thing as the
government is biased towards the corporates and the private hospitals.
Sociological
The commercialization of healthcare facilities in India is leading to an increase
in the rich and poor divide. The rich can afford the treatment but the poor cannot.
The rich are almost disease-free but the poor succumb to it. The mortality rate is
high among poor people.
Many times, the poor do visit the doctor or fear to visit them, because they fear
that they would not be able to afford the treatment. The poor lose everything, their
house, their wealth and even sometimes, they commit suicide also, as they might
not be able to pay their medical bills.
Because of the commercialization of healthcare, the general public has today
developed a concept that doctors are not God, they have become the thieves, who
are there to loot you, the doctors are the front face of the hospitals, not the hospital
authorities.
WAY FORWARD
•• Must accommodate a minimum number of states referred patients who are
eligible to avail NCD services for cashless treatment of their ailments (To
avoid commercialisation).
 117
•• Common entrance test all over the country to award seats to meritorious
students to reduce commercialisation of medical education. The NMC bill
raises concerns about the commercialization of medical education as private
medical colleges have been provided with the freedom to fix fees for 60%
of the seats.
India is a land full of opportunities for players in the medical devices industry. The
country has also become one of the leading destinations for high-end diagnostic
services with tremendous capital investment for advanced diagnostic facilities,
thus catering to a greater proportion of the population. Besides, Indian medical
service consumers have become more conscious of their healthcare upkeep.
The Indian healthcare sector is much diversified and is full of opportunities in
every segment, which includes providers, payers, and medical technology.
With the increase in the competition, businesses are looking to explore the
latest dynamics and trends which will have a positive impact on their business.
The hospital industry in India is forecast to increase to Rs. 8.6 trillion (US$ 132.84
billion) by FY22 from Rs. 4 trillion (US$ 61.79 billion) in FY17 at a CAGR of
16–17%.
The Government of India is planning to increase public health spending to 2.5%
of the country’s GDP by 2025.
India’s competitive advantage also lies in the increased success rate of Indian
companies in getting Abbreviated New Drug Application (ANDA) approvals.
India also offers vast opportunities in R&D as well as medical tourism. To sum
up, there are vast opportunities for investment in healthcare infrastructure in both
urban and rural India.
Conclusion
Commercialization of healthcare results in bringing better facilities and
infrastructure to the healthcare system. But this should not lead to high costs
that are not affordable to many. To provide universal access to healthcare, the
government should improve the quality of treatment in government hospitals.
The government is responsible for this action. It must ensure that every citizen
of the country gets access to good health care. The government should make sure
that’s its hospitals run efficiently and it should regulate the prices of the medical
treatments. It should also motivate private investors to regulate their prices
keeping in mind their profit motive. Only by such steps, the population of India
will be able to live a healthy life.
 ADVANTAGE INDIA
Strong Attractive
Demand Opportunities
• Healthcare market in • The Government of India
India is is expected aims to increase healthcare
to reach US$ 193.83 spending to 3% of the
billion by 2020 and Gross Domestic Product
US$ 372 billion by (GDP) by 2022
2022, driven by rising • Two vaccines (Bharat
income, better health Biotech’s Covaxin and
awareness, lifestyle Oxford-AstraZeneca’s
disease and increasing Covishield manufactured
access to insurance by Serum Institute of India)
– medically safegurading
Indian population and
those of 100+ countries
against COVID-19
Rising Policy and
Manpower government
Support`
• Availability of a large • In Union Budget 2021, the
pool of well-trained government allocated RS.
medical professional in 35,000 crore (US$ 4.80
the country. billion) for COVID-19
• The number of doctors vaccines in 2021-22
with recognised medical • In March 2021, the
qualification (under Parliament passed the
I.M.C Act) registered National Commission
with state medical for Allied,Healthcare
council/medical council Professions Bill 2021,
of India increased to which aims to create a
1,255,786 in September body that will regulate
2020 from 827,006 in and maintain educational
2010. and service standards for
healthcare professional
118